Income Tax Assessment Act 1997
CHAPTER 4
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INTERNATIONAL ASPECTS OF INCOME TAX
A payment gives rise to a hybrid financial instrument mismatch if:
(a) the payment gives rise to a *hybrid mismatch under section 832-215 or 832-230 ; and
(b) subsection (3) or (6) applies.
The deduction component of the *hybrid financial instrument mismatch is the *deduction component of the *deduction/non-inclusion mismatch. 832-200(3)
This subsection applies if the following entities are related for the purposes of subsection (4):
(a) the entity that made the payment;
(b) each entity that is a *liable entity in respect of the income or profits of the recipient of the payment.
Two entities are related for the purposes of this subsection if any of the following apply:
(a) the entities are in the same *Division 832 control group;
(b) one of the entities holds a *total participation interest of 25% or more in the other entity;
(c) a third entity holds a total participation interest of 25% or more in each of the entities. 832-200(5)
For the purposes of subsection (4), treat the *direct participation interest of an entity (the holding entity ) in another entity (the test entity ) as being the sum of the direct participation interests held by the holding entity and its *associates in the test entity. Structured arrangement 832-200(6)
This subsection applies if the payment is made under a *structured arrangement.
PART 4-5
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GENERAL
Division 832
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Hybrid mismatch rules
Subdivision 832-C
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Hybrid financial instrument mismatch
Operative provisions
SECTION 832-200
When a payment gives rise to a hybrid financial instrument mismatch
832-200(1)
A payment gives rise to a hybrid financial instrument mismatch if:
(a) the payment gives rise to a *hybrid mismatch under section 832-215 or 832-230 ; and
(b) subsection (3) or (6) applies.
Note:
As a result of ordering rules in later Subdivisions, a payment that gives rise to a hybrid financial instrument mismatch does not also give rise to a hybrid mismatch under a later Subdivision of this Division.
832-200(2)The deduction component of the *hybrid financial instrument mismatch is the *deduction component of the *deduction/non-inclusion mismatch. 832-200(3)
This subsection applies if the following entities are related for the purposes of subsection (4):
(a) the entity that made the payment;
(b) each entity that is a *liable entity in respect of the income or profits of the recipient of the payment.
Note:
For the definition of liable entity, see section 832-325 .
Related persons 832-200(4)Two entities are related for the purposes of this subsection if any of the following apply:
(a) the entities are in the same *Division 832 control group;
(b) one of the entities holds a *total participation interest of 25% or more in the other entity;
(c) a third entity holds a total participation interest of 25% or more in each of the entities. 832-200(5)
For the purposes of subsection (4), treat the *direct participation interest of an entity (the holding entity ) in another entity (the test entity ) as being the sum of the direct participation interests held by the holding entity and its *associates in the test entity. Structured arrangement 832-200(6)
This subsection applies if the payment is made under a *structured arrangement.
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